Plans for New Multifamily Development Push Architecture Billings Index To Highest Level Since August 2010 even as Other Commercial-Industrial Projects Lag
Billings at architecture firms, a leading indicator of future commercial construction activity, rose in September at their fastest clip since August 2010.
According to the American Institute of Architects (AIA), the September Architectural Billings Index rose 1.4 points to 51.6. The ABI Index predicts hard construction spending that will occur nine to 12 months ahead.
Any index number above 50 indicates an increase in billings. A separate index tracking new projects was 57.3 in September, compared to a mark of 57.2 the previous month.
"Going back to the third quarter of 2011, the multifamily residential sector has been the best performing segment of the construction field," said AIA Chief Economist Kermit Baker. "With high foreclosure levels in recent years, more stringent mortgage approvals, and fewer people in the market to buy homes, there has been a surge in demand for rental housing."
"The upturn in residential activity will hopefully spur more nonresidential construction."
Among the regions of the U.S. the west led with a score of 53.4, followed by the south (51.9), northeast (49.5) and Midwest (47.2).
Multifamily residential led all property types at 57.3. The only other category to show positive growth was institutional buildings at 51. Other types, including commercial/industrial and mixed practice, showed slightly negative demand.
The regional and sector categories are calculated as a 3-month moving average, whereas the index and inquiries are monthly numbers.